Stablecoin publisher Tether is switching to tokenizing stocks and bonds
Tether Holdings Ltd., the world’s largest digital asset company, is engaged in the tokenization of stocks, bonds, funds and commodities.
The Hadron by Tether platform, which launched on Thursday, will allow users to convert assets into products ranging from stablecoins pegged to fiat to digital tokens backed by commodities or other forms of collateral. The British Virgin Islands-registered company targets businesses and governments as customers, Tether said in a press release statement.
Converting assets into tokens allows them to be traded faster and at a lower cost. The assets can be traded on blockchains by transferring them from one cryptocurrency wallet to another.
These potential benefits brought Wall Street firms such as BlackRock Inc., JPMorgan Chase & Co. and Franklin Templeton in recent years to offer tokenized money market and investment funds.
Stablecoins, a form of crypto token tied to another asset, use reserves to support their value. They are an integral part of the way crypto markets work and act as a less volatile alternative for traders looking to swap between digital assets and store their wealth. Tether’s stablecoin USDT, which is pegged to the dollar and backed by government bonds and other assets, currently has more than $126.6 billion worth of tokens in circulation.
The tokenization platform is Tether’s latest attempt to expand beyond its core business. The company announced last week that it has completed the financing of its first crude oil transaction in the Middle East as part of a plan to become a lender in the commodities business.
The closely held company has been the center of controversy in the past. Tether previously faced fines from the Commodity Futures Trading Commission and settled with the New York Authority General over allegations that it had lied about its reserves and made misleading statements in the past.
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